When you sign a contract to buy a house, you`re taking a significant step towards homeownership. But what exactly happens when you sign on the dotted line? Here`s a breakdown of the key things you can expect to occur.
1. Earnest Money Deposit:
After you and the seller have agreed on the terms of the sale, you`ll typically need to provide an earnest money deposit to show your commitment to the purchase. This amount can vary based on the location and price of the home, but it`s usually between 1-5% of the purchase price.
2. Home Inspection:
Once the contract is signed, you`ll typically have a specified period to conduct a home inspection of the property. This is a crucial step in the home buying process as it gives you an idea of any issues with the house that can be addressed before closing. You can request repairs or negotiate a lower price based on the findings of the inspection.
3. Mortgage Application:
After signing the contract, you`ll need to complete a mortgage application and provide the lender with documentation to confirm your income, assets, and expenses. The lender will then review your application and determine whether you meet their requirements for a mortgage.
4. Title Search:
The title search is conducted to ensure that there are no liens or claims against the property that would prevent you from owning it. Additionally, title insurance may be required to protect you from any unforeseen issues that arise with the property`s title.
5. Closing:
The closing is the final step in the home buying process where you sign all of the necessary paperwork and pay the remaining costs associated with the purchase. You`ll typically be required to bring a down payment, closing costs, and any other fees, all of which will be detailed on the closing disclosure provided by your lender.
Overall, signing a contract to buy a house is just the beginning of the home buying process. With the help of a trusted real estate agent and lender, you can navigate each step and move closer to closing on your dream home.